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MTN’s MoMo bank commences operations in Nigeria

Samuel Mungadze
By Samuel Mungadze, Africa editor
Johannesburg, 20 May 2022
Karl Toriola, MTN Nigeria CEO.
Karl Toriola, MTN Nigeria CEO.

MTN’s Mobile Money (MoMo) payment service bank (PSB) has formally begun operations in Nigeria.

The telco notified shareholders of the development, saying the opening of the bank followed a successful pilot initiated on 16 May.

MTN says this is a key milestone in delivering the company's Ambition 2025 strategic priorities, and the bank is poised to enable millions of unbanked and underserved Nigerians to access a wide range of financial service products.

In addition, the telco says, MoMo wallets in the future will enable Nigerians in the diaspora to send money to any phone number in the country, “an important feature given Nigeria's ranking as the destination for the highest remittance inflow in Sub-Saharan Africa”.

MTN Group first announced its steps in the process towards final approval of the licence in November, saying this was subject to the fulfilment of certain conditions as stipulated by the Central Bank of Nigeria (CBN).

With the payment services bank licence, MTN Nigeria will offer a wider range of mobile financial services beyond the traditional person-to-person mobile money transfers, such as lending and bill payments.

The commencement of bank operations is a positive step in the telco’s fintech drive and comes as the MTN Group is on track to spin-off its lucrative fintech business.

The telco has set the second quarter of the 2022 financial year as the deadline to spin-off its financial services unit.

Karl Toriola, CEO of MTN Nigeria, says: "We are grateful to the CBN for their support and guidance through the process. This is an important milestone for MTN Nigeria in our mission to support government's drive towards financial inclusion in Nigeria. Nor just for those in urban centres and markets, but also people in the rural and remote areas of the country who remain excluded from the financial system."

For MTN Nigeria, the MoMo bank will bolster its already flourishing fintech business, which is growing rapidly into its most rewarding market.

In the current reporting for the first quarter of 2022, MTN Nigeria fintech revenue rose by 46.7% on the back of the growing adoption of fintech services and an expanded user base.

MTN’s MoMo agent network continued to widen, with more than 800 000 registered agents and over 166 000 active agents.

MoMo PSB CEO Usoro Usoro comments: "Providing easy to use, accessible and affordable financial services to all Nigerians is essential to executing the CBN's financial inclusion strategy and the digital inclusion agenda of the minister of communications and digital economy.

“We look forward to playing our part and are excited about the opportunities to partner with relevant institutions across various sectors to co-create and expand access nationwide."